Plan to cut thousands of free cash machines could go ahead within days when operator reaches decision on whether to reduce fees

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A cost-cutting plan that may lead to the loss of thousands of free cash machines could go ahead within days, campaigners said last night.

Banks have demanded a reduction in the fees they pay when a customer withdraws money from an ATM that is owned by another operator.

If they get their way it is feared many unprofitable machines would be shut down, hitting isolated communities and small firms.

Link, which oversees the country's network of 70,000 free ATMs, is expected to announce by January 31 its decision on whether fees should be cut.

But it is expected to reach a verdict privately before then.

Banks have demanded a reduction in the fees they pay when a customer withdraws money from an ATM that is owned by another operator. If they get their way it is feared many unprofitable machines would be shut down, hitting isolated communities and small firms

Business groups, MPs and campaigners last night pleaded with Link to change course and protect the network.

Wes Streeting, a Labour member of the Commons Treasury committee, said: 'As thousands of free ATMs in small towns and villages hang in the balance, I hope those taking the decision about ATM fees have seen the level of public concern about access to local cash machines. 

'This is one MPs will be watching closely.' 

The Treasury committee is asking the Payment Systems Regulator, which is responsible for Link's conduct, to make sure consumers are not harmed by the changes. 

Mike Cherry, of the Federation of Small Businesses, said: 'With only a matter of days to go until Link announces its final decision on lowering the fee paid to cash machine providers, different operators are still at loggerheads over the implications of a reduced fee. 

'The PSR must step in if Link's decision negatively impacts consumers and small businesses.

'With the bank branch network in rapid decline, it's more vital than ever that we have a robust ATM network across all areas of the UK.

'Dropping the interchange fee could seriously hamper cash flow in local economies, particularly in rural areas and tourist hotspots. 

Wes Streeting, a Labour member of the Commons Treasury committee, said: 'As thousands of free ATMs in small towns and villages hang in the balance, I hope those taking the decision about ATM fees have seen the level of public concern about access to local cash machines.'

'That would mean less opportunity for small firms to invest, create new jobs and push our economy forward.'

Link claims that the 20 per cent cut in fees over four years – from 25p to 20p per average withdrawal – is necessary to stop banks from pulling out of its system altogether.

Bosses also suggest that there too many ATMs and numbers need to come down to a sustainable level.

Link has already been forced into a partial climbdown, saying it will now protect the network in remote areas.

James Lowman, of the Association of Convenience Stores, said: 'When any community is deprived of a free cash machine, it has a negative effect on businesses.

'We remain very concerned about Link's proposals.'

Link claims that the 20 per cent cut in fees over four years – from 25p to 20p per average withdrawal – is necessary to stop banks from pulling out of its system altogether